SSE says its on track to raise its dividend to shareholders above the rate of inflation despite profits for the first half projected to be lower than reported last year.

The Perth-based energy firm announced to the stock market it will maintain “operational and financial discipline” in light of political debate sparked last week by Labour leader Ed Miliband's pledge to freeze energy prices for 20 months if his party is elected.

That announcement led to a seven per cent slide in SSE's share price last week.

SSE said in a market update on Monday it expects its retail division “has been loss-making” in the six months to September 30, “reflecting higher wholesale gas costs”.

SSE said first-half performance, especially across its retail and wholesale divisions, “is more likely to fluctuate, with unusual variations or circumstances,” in energy consumption.

The group added “the heightened impact of fixed distribution and other costs, which themselves were rising, during the spring and summer period of lower energy consumption”, had also impacted on first-half profitability.

However, SSE said its wholesale and networks divisions are “expected to have been profitable during the six months”.

SSE said although adjusted profit before tax for the six months to September 30 is expected to be “lower than it was in the same six months in 2012”, it remains on track to increase the final dividend for the year by more than retail price inflation.

The group said ratings agency Standard & Poor's has also confirmed SSE's funds from operations to debt ratio for the year to March rose to 20.8 per cent against 19.5 per cent in 2011/12, which is above Standard & Poor's 20 per cent criterion.

SSE said Standard & Poor's long-term rating “remains at A minus” with a negative outlook while ratings firm Moody's corporate credit rating of SSE remains A3 with a stable outlook.

Group finance director, Gregor Alexander, said: "Despite challenging energy market conditions, SSE has made solid progress in recent months, including taking a number of specific steps to help small business customers and improve standards for household customers.

“We continue to benefit from maintaining a balanced range of energy businesses, illustrated by again meeting the criteria for a single A credit rating.

“Despite the intensifying political debate, we will maintain our operational and financial discipline, to enable us to deliver an above-inflation increase in the dividend for this financial year and beyond.”